Tan Kin Lian's Blog: Stuyvesant Town, Manhatten

Tuesday, January 26, 2010

Stuyvesant Town, Manhatten

The Government Investment Corporation of Singapore (GIC) invested in a Manhatten project called Stuyvesant Town.

Here are some views about this project.
http://news.asiaone.com/News/the%2BStraits%2BTimes/Story/A1Story20100126-194428.html

http://www.dailyfinance.com/story/investing/biggest-real-estate-deal-in-history-goes-belly-up/19330496/

http://www.nakedcapitalism.com/2010/01/tishman-hands-stuyvesant-keys-back-to-banks.html
http://in.reuters.com/article/email/idINN2518834220100125

14 comments:

Anonymous said...: Convert Stuyvesant Town into an HDB estate that is managed by HDB.

Price guaranteed go up!; January 26, 2010 9:46 AM
KFC said...: GIC invested USD675 mln in the project! Has the whole amount written off as a BIG loss already?; January 26, 2010 1:18 PM
Anonymous said...: Imagine the wonder it can do if a small percentage amount is given to Ren Ci charity.....sad; January 26, 2010 1:46 PM
Anonymous said...: I'm just thinking of this US$675 million investment and the old Beatles' song "Imagine".

Imagine if the money was invested in our young children's education instead.

Instead of cramming 35-40 students into one class, Imagine we could instead reduce the ratio to maybe 15 students per class.

Imagine, teachers could actually get to know the students and help develop their character instead of just being exam driven.

Imagine our leaders actually walking their talk. There are so few children. Every child is precious. Nobody gets left behind.

But instead we've got no money to invest in our children and their teachers. But we've got plenty of money to "invest" in stone structures in an overseas country.

Real estate prices go up and down in most countries. It's only uniquely Singapore that real estate prices are more (how shall I put this delicately?) predictable.; January 26, 2010 2:24 PM
Anonymous said...: Yup, I think it was reported 2 weeks ago that as a prudent accounting, GIC had already written off this investment in Nov/Dec 2009 when it became clear that the investment was no longer tenable and solvent. Of course GIC kept quiet until WSJ and other western press started to report about it.

Not sure how much can GIC get back. The market value of the property is at most only 1/3 of what they paid for it. I think in the US property slump, GIC can only get back at most 25cents on the dollar, if they want to find another investor to unload to.

Heck, I am willing to pay GIC S$100 to take over their investment! :-); January 26, 2010 2:38 PM
Anonymous said...: Oh, forgot to add that GIC probably also analysed this investment with Singaporean glasses. Becoz the whole investment value premise was that they could kick out all the existing tenants, renovate the whole place, and turn it into some swanky residences that the investors can charge exhorbitant rentals.

In S'pore the above will be part-and-parcel of Singapore Inc methodology, police will be there to kick out the resistant tenants, and nobody will kick up a fuss except Business Times will say what a wonderful investment masterstroke by GIC.

Unfortunately in New York, the laws are very pro-tenants and somemore the property is rent-controlled -- something like semi-public flats. Cannot anyhow hantam the consumers. In this case, the consumers hantam back. Go to court somemore. And the judge supports the consumers -- fine the investment company US$200m. So the investment company du-lan, walk away from US$4.4 billion mortgage loans (US$675m from GIC) and throw the whole building aka give the middle finger at the creditors to handle.

Somehow I find it difficult that our $3.5 million MM was not able to forecast this, even though he himself said that he is not doing much except forecasting.; January 26, 2010 2:53 PM
Anonymous said...: SGD$1 bln boh liao (no more)... honest mistake made... no one will be responsible... move on... as usual...; January 26, 2010 8:29 PM
Anonymous said...: As a taxpayer, I really want to know how this mis-calculation can happen and what follow-up actions were taken to rectify this huge loss. We cannot let it pass like nothing has happened.; January 26, 2010 11:25 PM
Anonymous said...: I know now why minibond investors were told why you went in with the eyes opened! Your loss is nothing compared with GIC's and temasek's; January 26, 2010 11:48 PM
Anonymous said...: GIC will say don't look at a single lost, look at big picture. Remember they made good on Citibank investment?

Anyway, they always say whatever they want and how they want.; January 26, 2010 11:54 PM
Anonymous said...: IF this lost happened in Taiwan or Hongkong, what will happen? THe decision maker need to apologize to the public and leave the position. Even in China, this big lost have to be beared by somebody. But here, no apologize culture and goverment never make mistake.; January 27, 2010 8:26 AM
Anonymous said...: Not only government don't apologize, sometime they say a small setup does not mean removing responsible person. If so, no talent to replace.

I think they continue to take us for granted i.e. we will always vote for them as if we are just plain Koon-do. Hope next election we can give them a different message.....; January 27, 2010 1:12 PM
PaP said...: We will still vote them into power.
We are not stupid to vote some untested party in.. singaporeans are very cautious and will not risk their future. They may not get 60% of total votes, but they will remain in control.

We always want safety.

There are only risk takers for car parking: ie: gamble on the coupon and the attendant not checking...; January 27, 2010 4:14 PM
Anonymous said...: 4:14pm Was PAP a tested political party when in oppostion before 1959?; February 01, 2010 11:01 AM